UBS noted in a report dated May 22 that silver's approximately 140% price surge last year is curbing buyer demand across industries, with its elevated price levels beginning to pressure consumption. They stated, "Demand erosion is likely to persist as long as prices remain at current levels." "Unlike gold, which benefits from robust central bank purchases, silver lacks such a strategic demand anchor and has not yet entered official reserve assets. Consequently, silver is more susceptible to shifts in private investment and industrial demand, and its performance may lag behind gold." UBS views silver as an "unattractive" holding, arguing that the current investment rationale does not offer investors sufficient returns to compensate for the associated volatility. Silver's remarkable rally peaked on January 28 this year, when prices surpassed $120 per ounce, only to experience a nearly 30% plunge within a single day. Since hitting a 2026 low of $67.60 per ounce on March 20, prices have recovered somewhat but remain well below pre-Iran war levels. Both spot silver and silver futures rose in May, trading around $87 per ounce on May 14, before another round of selling led prices to consolidate within the $75–$78 range over the past two weeks. On Thursday, spot silver was recently trading down 3.7% at approximately $72.13 per ounce, while the nearby U.S. silver futures contract also fell 3.7% to settle at $72.16. However, HSBC analysts indicated that the metal is "fundamentally overvalued" and its trajectory may diverge from gold's. They wrote in a report released Thursday, "We see limited further upside as, in our view, silver remains overvalued." "Gold prices may still exert influence, but we believe the gold-to-silver ratio could widen, potentially leading silver to soften even if gold advances." Macquarie analysts also see little room for a silver price recovery. Their strategists anticipate the Federal Reserve will raise interest rates in the first half of 2027, thereby applying downward pressure on precious metal prices. Macquarie analysts wrote in a May 21 report, "While we expect silver's average price to remain near this level for the rest of the year, volatility will persist until Middle East tensions are resolved, with significant downside risks if the macroeconomic environment deteriorates further."